What does it take to successfully settle outstanding, derogatory debt? It takes professional "know how" and guidance as well as an understanding of budgeting money necessary to do the settlement.
There are some very important things that Smart Solutions Financial Services takes into consideration when settling debt and those are as follows:
(1) Make sure everything is fully documented and in writing. This can have a large impact on credit, and credit scoring. The terms and the conditions must be clearly spelled out with regard to how an account is normally settled.
(2) Save the client as much money as possible. Much of the time collection agencies will settle for as little as 30% of the balance owed. Many times banks will settle charge off accounts for 70% of the balance owed.
(3) The account should be acknowledged by the parties as being of a "disputed nature” especially if cashed by the Payee. The reason for this is so that the debtor can successfully settle the account. Sometimes, without this notice, the part that the debtor "saves" by not paying can later haunt the payer. Specialized verbiage in the settlement process forbids the payee to submit any 1099 tax filings with the IRS against the debtor. Smart Solutions management has spoken to bank officials on one account that one of the bank's clients had settled (it was a $1,000,000,000 account without the help or paid assistance of Smart Solutions) and that bank's president settled the account for $200,000 and sent the debtor a 1099 for $800,000 under the auspices of "unjust enrichment." Had the debtor known about Smart Solutions' Credit Repair services, that bank would have been prohibited from sending a 1099 into the IRS.
(4) Smart Solutions Financial Services staff makes sure that the settlement includes a deletion clause as part of the settlement terms and conditions whereby the creditor (payee) must delete the derogatory information fully and completely from the payer's (debtor's) credit report in its full entirety. This means that the account is completely erased from the client's credit report as if it never existed. Additionally, when clients make their own settlements, they don't realize that when the account is paid, that information will report on the credit report as a paid derogatory account. Paying derogatory accounts without this deletion clause actually DAMAGES your credit report and your credit scoring by at least 20 - 30 FICO score points because the account will update to report the new information. Furthermore, that old account will now appear as if it is a newly placed derogatory account on the payer's credit report if a restrictive endorsement is not employed in the debt settlement process.
(5) A settlement, such as the ones made by Smart Solutions staff will always have additional consideration as a part of the terms and conditions of settlement. These funds actually create a new, legally binding contract with the creditor.
(6) It is very important that when settling a judgment, that the payer does not use his or her own primary bill paying account. Prior to becoming Smart Solutions clients, debtors attempting to settle accounts in the past with attorney offices (or their clients) had their accounts levied by the attorney's office. This means that the accounts were frozen and the debtors could not use the accounts to pay their primary bills, get petrol or even food! It is important the debtor sets up a completely different account at a different bank or credit union (where they are not banking) altogether so that if this does happen, a levy on the settlement account will not cause the debtor financial devastation.
(7) Once a payment is accepted by the attorney or the creditor on a judgment and a Satisfaction of Judgment is not issued, Smart Solutions staff can send notice to the attorney's office demanding that the document be filed or that the debtor may file suit for breach of terms and with regard to credit interference. Also, our documentation does clearly state that if a Satisfaction of Judgment is not issued by the Plaintiff’s Attorney, then the Complainant Debtor reserves the right to file a complaint with the Chief Office of Disciplinary Counsel.
(8) There are even more issues that are part of the settlement agreement that Smart Solutions uses with regard to settling accounts such as avoidance for the creditor to change terms and conditions and waiving their rights of future protest and future claims, etc.
Accounts that settlements can be done on are widely varied from collections, to mortgages to even tax liens. It's always important to keep track of all documentation - even documentation such as Smart Solutions' restrictive check endorsement prior to cashing and having documents signed, dated and notarized is important - including the front and backside of checks which have a restrictive endorsement on the backside and the disclosure notice printed on the face of the check. Also, it is important to make copies and keep hard copies of the front and backside of cashed checks as proof of payment so that if ever the moment arises that proof is required that the account has been paid, then it will not be a challenge for the debtor to provide that proof to the person who requires it.
(9) The check normally will indicate to the Payee that the document is one of accord and satisfaction. The check will also have some of the Check account information on it to clarify that it is the same check being submitted to the creditor for satisfaction of the debt.
(10) Check Identification is made clear as a part of the restrictive endorsement. The questions are always answered as to who is the payee; who is the payer; what is the check number and amount; what is the account number or docket number.
(11) Check replacement with a check draft is strictly prohibited. The payee may not use a check drafting system to avoid cashing the check with the restrictive endorsement imprinted on the backside of the check. If the Payee does replace and/or destroys the check with the replacement draft, the restrictive endorsement will mandate that such a draft with be considered the same as cashing the check with the restrictive endorsement.
(12) Disputation of the terms and conditions of the restrictive endorsement that is employed under a so-called “automated system” is not acceptable. Our firm always assumes that a human being (not a robot or android) always picks up the mail and opens envelopes.
(13) The Restrictive Endorsement Is Not Subject To Marked Change By The Payee. In some States, the Payee could make modifications to the restrictive endorsement and get away with it. Under these conditions, the check expressly mandates that the agreement cannot be changed in any way by the Payee.
Additional Information:
If you have more questions, comments and concerns with regard to successful debt settlement, please contact Smart Solutions Financial Services and speak to one of our Representatives about assisting you with successful debt settlement services. All documentation used by Smart Solutions Financial Services has been approved by Smart Solutions’ legal counsel.
E-mail: info@smartsolutionsfs.com